Important events
Mar 212023
XAU/USD: Gold Slips as Bank Contagion Worries Subside
The precious metal drifted lower from a 12-month high above $2,000 as bank sentiment improved.- Gold hit a one-year high of $2,010 as bank fears rattled investor confidence in risk assets and pushed them into the perceived safety of the bullion. Now that those worries started to ease a bit, the precious metal moved back under the $2,000 threshold, snapping a three-day winning streak.
- Prices per troy ounce last dipped about 2% from their peak during Monday’s volatility, and today traded around the $1,975 mark. Over the past 10 trading days, gold added roughly 10% to its valuation to flash prices last seen in March 2022, hovering below the all-time high of $2,075 per ounce.
- This recent $170 rally was largely boosted by the faith-shattering banking crisis which led to the collapse of four major banks, including SVB and Credit Suisse. While more are threatened, central banks are putting efforts to shore up confidence in the system, and that’s what eased gold prices today.
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Mar 172023
XAU/USD: Gold Moves Higher as Market Unease Remains
The precious metal is looking bright this week as investors bet on its safe-haven allure amid bank woes.- Gold bounced for a third consecutive day to float near its weekly high amid continued market worries that the banking system may indeed be in trouble. Despite Wall Street moving in to shore up the banking system, investors are happily flocking to gold as their safe-haven play.
- XAU/USD advanced to $1,934 per ounce in early Friday deals. The shiny gains helped propel gold’s prices to levels around this year’s peak performance. Still, some cautiousness is expected to set in as markets shift focus on next week’s rate-setting Fed meeting.
- Behind the upside swing were a number of factors - jobless claims in the US fell, indicating a still-strong labor market. Besides, amid the financial chaos and bank-fueled market turmoil, the European Central Bank surprised money managers and gold traders with a 50bps rate hike.
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Mar 152023
XAU/USD: Gold Rally Eases as Bond Yields Climb
A sweeping rise in Treasury bond yields pressured the precious metal after a four-day winning streak.- Gold fell on Tuesday and extended the decline in the early hours of Wednesday’s session. Weighing on the yellow metal is a rise in Treasury yields after investors’ fears of a banking crisis were soothed by the US government leaning against the financial system.
- The precious-metal asset lost half a percent on Tuesday and another 1% during the first deals in Wednesday’s European session to hover near $1,890 per ounce. Higher benchmark Treasury yields are typically more preferred by investors compared with zero-yielding bullions.
- Gold broke a four-day winning streak on Tuesday – a rally, driven by panic on Wall Street after regional banks brought back 2008 financial crisis vibes. The gloomy outlook has cleared up with banks becoming fashionable again, taking the shine off bullion’s fresh surge.
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Mar 102023
XAU/USD: Gold Climbs for Third Straight Day
Key economic data might challenge the short-term bullish sentiment as February’s jobs report arrives.- Gold is moving higher for a third consecutive day on Friday as bulls hope to pare back early-week losses. The precious metal is up roughly 1.4% from its Wednesday low of $1,804. Still it’s looking to close the week in the red if gold bugs don’t lift prices above $1,855 per troy ounce.
- Getting there might not be that difficult if there’s a strong bullish reaction to the looming jobs report. February’s nonfarm payrolls, slated for release later today, will reveal how many Americans got hired and are now maybe reluctantly joining video calls with their bosses.
- Regardless, gold has advanced quite substantially from its November 2022 low when prices hovered near $1,600 per ounce. Percentage-wise, that’s a 13.5% increase in a 5-month time span – not too spectacular compared with the broader market sentiment during the same period.
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Mar 072023
XAU/USD: Gold Off to a Slow Start Ahead of Busy Week
The precious metal pared back some gains as gold bugs anticipated a roster of economic news.- Gold treaded water Monday and remained flat Tuesday as investors were bracing for elevated volatility in the face of what’s coming. Trepidation is felt not only in the gold market, but also in silver and some corners of the currency market as well as in stock dealmaking.
- Jay Powell, chief of the Federal Reserve, is lurking in the near distance, getting ready to deliver a speech before Congress during his scheduled appearances on Tuesday and Wednesday. His remarks will be followed by the key jobs report slated for release on Friday.
- Coming off from a three-week high, the yellow commodity slipped to a weekly low of $1,844. Gold traders swooped in to support the price, buoying it by about $5 but those uncertainties ahead might quickly change the narrative over gold’s performance in the short-term.
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Mar 032023
XAU/USD: Gold Brings Back the Shine
Prices of the yellow metal rose on Friday and are on track to log their best week since January.- Gold is up on Friday as traders are betting that more rate hike uncertainty from the Federal Reserve will drive increased demand for those precious bullions. Prices jumped half a percent, or just over $8, in early-hours trading, with gold gravitating toward the $1,845 level.
- Today’s move to the upside is looking to position gold in its best weekly performance since January – more than 2%, or roughly $40, have been added to the price of gold this week. On the other end of the trade is a lossmaking dollar. “Finally.” - short sellers, probably.
- What’s driving the narrative for gold this week? It’s likely a mix of some position-squaring and a rotation out of US dollars and into precious metals. With the nonfarm payrolls slated for next Friday, money managers are figuring out ways to hedge their risks in case things go haywire.
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Feb 282023
XAU/USD: Gold drifts lower as dollar gains
The precious metal turned to the downside early on Tuesday as fresh dollar gains shuffled valuations.- Gold continued its descent Tuesday morning on the back of a stronger US dollar as finance bros once again rushed to the safety of the greenback. And for good reasons – inflation is creeping up, labor market is still tight, and the Fed might hike rates to lean against it all.
- In this light, gold’s shimmering shine was not enough to entice. XAU/USD prices slipped to their lowest levels in 2023, dipping near the $1,800 threshold. With its latest lackluster performance, gold waved goodbye to all of the gains made in 2023, all the way through $1,962 per ounce.
- Looking ahead, there really is not much to stir the market and inject some enthusiasm, at least in terms of scheduled economic reports this week. Gold bugs are looking at a flat-out boring economic calendar, suggesting its time for the technical gurus to impress with price-predicting formations.
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Feb 232023
XAU/USD: Gold drops after Fed minutes release
Broad dollar gains were in the spotlight post-minutes as XAUUSD inched lower.- It hasn’t been a good month for gold and the latest Fed minutes didn’t even try to make it better. Gold prices extended their decline yesterday and Thursday morning, hovering near a seven-week low around $1.825 per troy ounce. Total loss for February hit 5.5%.
- On Wednesday, Fed chairman Jay Powell (JPow in meme-stock parlance) and the rest of the central bankers lifted the veil on discussions from three weeks ago. The minutes showed a Fed-wide sentiment to back more interest rate hikes in efforts to tame the inflation beast.
- Beside the dollar-benefiting Fed minutes, XAUUSD was further pressured by a growing number of economic reports in support of a stronger greenback. All in all, as long as the US economy is showing signs of resilience, gold may continue to be a secondary choice for traders.
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Feb 162023
Gold extends drop to 5-week low
The yellow metal is losing some of its shine on macroeconomic headwinds.- Gold prices failed to stage a rally last week and have been mostly slipping in the face of mixed global economic data. The precious metal is down about 6.5% from its February high of $1,962 per ounce and hit a 5-week low on Wednesday, dipping to $1,830.
- Bullion traders have so far been unable to break out of the downward spiral. But when so many factors are at play, it’s sometimes tough to keep track. More recently, the lid on gold appreciation was slammed by US retail sales data, which rose 3%, indicating economic resilience.
- Gold is positioned to benefit from high interest rates and, according to some financial gurus, even to thrive in a recession. But so far, that hasn’t been the case. Amid major rate hikes and looming recession fears, gold has been largely passed on by investors looking to riskier assets.
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Feb 102023
Gold prices seek to stage rebound
The yellow metal is reeling out of a 5-week low as gold bugs refuse to just sit and watch.- Gold prices are aiming to stage a recovery run early on Friday. After several days of steep losses mixed with muted sideways trading, the yellow metal hit a 5-week low at $1,852 per ounce. But today, gold bugs took out the shovels and scooped up some of that depreciated shiny stuff.
- As traders picked up the pace to help lift gold prices back in green territory, the safe-haven asset hit a session high at around the $1,870 threshold. Since the start of the month, gold has skittered down just under 5%, erasing most of January’s gains.
- The reverse move we see in gold is likely mostly a reflex, at least in the intraday frame, since no major news is on deck for the day. In other words, the stage is set for the technical gurus to seek inverted flippity-floppitty moo-moos with a giraffe neck for bullish confirmation.
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Feb 022023
Gold rush sweeps markets
Gold prices climb to a 9-month high after JPow’s dovish remarks.- The yellow metal is in a goldilocks moment as its price hit a 9-month peak of $1,960 per ounce early on Thursday. The rally was sparked by comments from Fed chair Jerome Powell (or JPow if you’re feeling bold) after the US central bank hiked rates by an expected 25 bps. Although hikes will continue, the Fed boss said, they won’t be super drastic.
- Gold bugs interpreted the news as positive for their beloved asset, propelling its price higher by just under 2% on Wednesday. The upside swing was pretty much in line with the broader market sentiment across risk assets – US stocks ended the day in the green as investors from every corner cheered the Fed’s decision. Except oil traders. Oil fell big time.
- Gold has been in a steady growth trajectory with prices rallying in recent months. What’s behind it? Contrary to the popular belief that gold is an inflation hedge, prices started moving higher on the first signs of cooling inflation in November. Also, milder rate hikes boost gold bets as the metal benefits from a lower-rate environment bc it’s a non-yielding asset.
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Jan 042023
The golden ticket
Gold has been on a rampage recently, and some experts think that 2023 could bring investors even more joy.- Gold prices reached a fresh 6-month high of $1,865 per ounce today, and have rallied by almost 10% over the last 3 months. Over the course of 2022 however, gold came full circle with only a 1.5% increase over the year.
- Experts believe the price pump has something to do with expectations of a recession, which is typically positive for gold prices. Central banks have also been purchasing gold, causing demand for the precious metal to swell.
- Another factor in the rally is the belief that the dollar will weaken in the year ahead, as well as expectations for the Fed to ease its aggressive rate hikes. A dovish pivot might just bring the golden ticket the commodity needs to keep the momentum going.
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Oct 122022
Trepidation station
Investors are feeling anxious this week as they’re faced with bearish global outlooks and looming inflation data, and the hawkishness is making gold less shiny.- Gold closed Tuesday in its fifth straight session in the red, having lost over 3.5% in that time despite a brief bull run the week before – volatility is the name of the game these days. The declines have come in the face of lifting real yields and a strengthening dollar, though sentiment seems to have had a brief reversal on Wednesday morning as gold traded within a narrow range and the dollar dipped.
- It’s a big week of macro news, and what we hear will likely impact prices over the next few weeks. The Fed latest meeting minutes will be released and hint at how hawkish the central bank is gonna be in its next hike – the more aggressive the Fed is, the less attractive gold looks bc higher interest rates increase the opportunity cost of holding the non-yielding metal.
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Sep 012022
The end of the gold rush
Pack up the excavation kit folks because the 2022 gold rush looks to be coming to a swift end as investors consider the Fed’s next moves.- Gold prices softened for a fourth consecutive session on Wednesday, with the yellow metal starting September in its sixth straight month in the red to take its YTD losses to over 5% – gold has now entirely erased any of its inflation-driven gains from earlier this year despite nearing an all-time high in March, and this marks its longest losing streak since 2018.
- Silver is faring equally as badly tbh despite analysts predicting that the metal had reached its 2022 bottom a few weeks ago – August was the precious metal’s worst month in just under two years and prices are trading at their lowest levels since June 2020.
- There’s a tug of war going on between precious metals and the dollar, with the greenback seemingly winning the battle rn given its strength this week. Investors in both are trying to digest news from Jackson Hole and predict the next rate hike, and analysts forecast continued weakness for metal prices until we see rate hikes ease and the dollar fall.
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Aug 152022
Yielding gains
Gold prices drift higher towards their fourth straight week of gains thanks partly to lower yields as investors digest economic news.- Gold climbed 0.70% on Friday to its highest close since early July at $1,802 per ounce. The drift higher was helped by a drop in long-term US Treasury yields on Friday after a volatile week of trading – the yield on the benchmark 10-year Treasury note and the 30-year bond both lost around 5 points on Friday.
- Investors are trying to evaluate what economic news means for the Fed, as is everyone. A recent jobs report had added to the case for more Fed hawkishness, pushing up the greenback and bond yields while sending down gold bc it pays no interest and is priced in the dollar.
- Gold has been fighting a resistance at $1,800 for some weeks now, and recent data finally pushed prices above that mark on Friday as people figured the Fed wasn’t done with its fight against inflation, making the yellow metal look rather attractive as a haven asset. Bearing in mind, this could all change come September…
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Jul 292022
What is a recession, anyway?
Precious metals are enjoying one of the best weekly rallies of the year just as economic data suggests the US could be (but probs isn't) in a recession.- Gold is enjoying its best week since March, now up 2.11% for the week so far after Fed Chair Jerome Powell hinted that the Fed’s aggression towards rate hike might be slowing in September; while Silver continues to rally towards its best week since December 2020 with 7.85% gains so far.
- Are investors looking for a hedge? New data shows that GDP in the US fell 0.9% YoY in the second quarter, representing the second straight quarter that the economy has shrunk, which is a common criteria for a technical recession, despite J-Pow saying on Wednesday that we were not in one (yet).
- What do you mean “technical recession”, I hear you ask. Well, turns out there’s some debate as to what actually constitutes a recession, and two quarters of economic shrinking is only one signal. Added to that, preliminary GDP data is often not quite accurate and needs months of revision given the size of the economy, so the data’s been taken with a pinch of salt.
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Jul 112022
An inflation hedge gets trimmed
Gold continues to lose its shine in the market thanks to growing fears about interest rates and the global economy.- Spot gold sank 3.77% last week for its fourth consecutive week in the red. The so-called hedge against inflation is in its fourth month down in goblin town after flirting with an all-time high in March, and is now trading around its lowest levels since September last year at $1,736 per ounce as of Monday morning.
- Growing strength in the US dollar is putting pressure on prices. The greenback hit its highest levels since 2002 last week, and investors are fleeing to the safety of the dollar as a hedge against inflation instead as the market faces turmoil – meanwhile, Bitcoin, which was once widely regarded as hedge, is also now sitting around 18-month lows.
- Another expected 75bps rate hike is souring sentiment toward gold bc it means a higher opportunity cost given the asset yields no interest. Analysts see gold as bearish in the long term but think there could be a bullish bounce on the way in the short term.
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